Weekly Mortgage News Roundup
Bank of England Keeps Interest Rates Steady
The Bank of England has decided to maintain interest rates at 5.25%, impacting mortgage holders across the UK. Despite average mortgage rates remaining unchanged, homeowners are facing challenges in finding favorable rates. Two-year fixed deals are at 5.74%, while five-year deals stand at 5.24%. The market is experiencing volatility due to increased costs for mortgage lending, leading to the removal of some cheaper deals.
Markets Speculating on Rate Cuts
MPC member Megan Greene warns that UK traders betting on Bank of England rate cuts may be misguided, as easing measures are not imminent. The US inflation rise to 3.5% in March has influenced market expectations, with US traders revising their interest rate cut forecasts. Greene highlights the differing economic conditions between the UK and the US, suggesting a cautious approach to rate adjustments.
UK Lenders Anticipate Mortgage Lending Boost
A Bank of England survey reveals that UK lenders foresee a strengthening in both mortgage supply and demand in the next three months. The housing market’s recovery is expected to drive this trend, with lenders preparing for increased default rates on secured and unsecured credit.
Mortgage Holders Advised to Consider Selling Homes
Rics survey findings indicate that UK house prices are stabilizing, with expectations of growth in the coming year. Mortgage holders are advised to evaluate selling their properties over the next 12 months amidst the potential for interest rate reductions and limited market activity acceleration.
